Calif. Firm Debuts Two Alts Funds
The RS Focused Opportunity Fund (RSFOX) looks to invest in companies that demonstrate attractive relative valuations, strong and stable growth, increasing return on invested capital and improving market sentiment.
The RS Focused Growth Opportunity Fund (RSFGX) invests in companies that produce sustainable earnings growth over a multi-year horizon and exhibit strong organic revenue growth, expanding margins and profitability, innovative products or services, defensible competitive advantages, growing market share and experienced management teams.
Both funds will invest primarily in U.S. equity securities selected by a fundamental stock selection process, and will leverage a quantitative analytical model to aid in the portfolio construction. Both funds will be available in retail and institutional class shares.
The strategy, a new one for RS Investments, will be led by Rick Brandt as the long/short portfolio manager overseeing both funds. He will also work closely with the RS growth and value investment teams, as well as the firm’s investment strategy group to develop new strategies.
The firm’s aim is to provide outcome-oriented solutions designed to limit downside risk across unpredictable markets, according to Matthew Scanlan, chief executive of RS Investments. “These alternative strategies leverage our demonstrated growth and value alpha generation capabilities, across market caps, to construct long/short portfolios that seek to balance alpha and beta.”
Alternatives can play a valuable role in retirement plans, Scanlan tells PLANADVISER. The firm offers separate accounts to provide institutional clients the access they need. “The Focused Opportunity funds are long/short funds that focus on the most desirable opportunities by investing in high-conviction, long positions that leverage the best ideas of RS Investments’ growth and/or value investing experts, while seeking to reduce volatility through an actively managed portfolio of short positions,” he explains.
“The path of returns is just as important as the returns themselves,” Brandt says. “The focused opportunity funds seek to improve client experience through optimized portfolio construction, a focus on demonstrated capabilities, and a better balance of risks.”
RS Investments, with approximately $20.4 billion in assets under management as of December 31, is a global investment management firm in San Francisco.